The Indian rupee, which was on a par with the American currency at the time of Independence in

1947, has depreciated by a little more than 65 times in the past 66 years. The rupee touched its
historic record low of below 65 against the dollar last week.
Indian rupee plummeted to a new low on Wednesday to almost 69 to the dollar on rising concerns
by foreigners invested in India at a time when a sharp surge in oil prices threatens to worsen the
country's current account position.This is the biggest daily decline in 20 years.
Due to European financial crisis the value of Rupee has been depreciated which has resulted in an
increase in the value of dollar. Thus, affecting the economy.
- The demand of dollar has increased in contrast to that of Rupee and has startled our economy.
- It has resulted in the depreciation of the Purchasing Power Parity (PPP).
- Depreciation of Indian Rupee has resulted in increase in inflation and thus, stagnant growth of the
economy.
Government would have to pay more in terms of Rupee for its imports. This would lead to rise in
fiscal deficit which in turn will raise the level of inflation.
India's central bank will provide dollars directly to state oil companies in its latest attempt to shore
up a currency that has slumped to a record low, reflecting the stiff economic challenges facing the
country in an uncertain global environment. The Reserve Bank of India announced late on
Wednesday a special window "with immediate effect" to sell dollars through a designated bank to
Indian Oil Corp Ltd (IOC.NS), Hindustan Petroleum Corp (HPCL.NS), and Bharat Petroleum Corp
The exporters gain from the depreciation of Rupee as they get more of the local currency in
exchange of the foreign one.
- The depreciating value of Rupee is like a boon to Indian IT sectors as it generates more than 80% of
their revenue from overseas market and this will enhance their actual realization of revenue.
- Emigrants living outside India also benefits from this depreciation